Evaluation of Hard and Soft Versions of HRM - Research Proposal Example

Critical Evaluation and Discussion on the Hard and Soft versions of HRM – A Comparative Analysis Abstract The real debate confronting the paradigms of HRM today is the problem of ‘deciding between the Rhetoric and Reality debate. On one end, a people-oriented rhetoric management approach of the soft HRM model and on the other side, it is a hard practice of strategic management, which lays emphasis only on the bottom-line of business. Through a thorough analysis of the concepts and the best practices approach of each, the paper analysis the gaps in the light of representative HRM factors from the operational point of view. It is difficult to arrive at a conclusion that soft or hard version are mutually exclusive and the future of modern day HRM needs to trace a path of synergistic mix of best-practice approaches of dimensions from both fields. This would help contribute to the body of knowledge in recommending the way forward as the best preferred HRM model for building more organizational competitiveness. Table of Contents Table of Contents 3 1.Introduction 4 1.1Research Objective 4 2.Literature 4 3.Summary/Conclusion and Recommendations 8 Reference List 10 Bibliography 11 1. Introduction Two distinct forms of HRM are ascribed to the concepts of soft and hard, that are diametrically opposite from each other. One dimension preaches of a tight strategic control and an economic model and the other one is a soft model based on commitment (Wood, 1996). It is difficult to accommodate both concepts into a unified model of human resource management. On a deeper note, the conflicts with the two schools of thought dissociate the developmentalist and instrumentalist principles from one another. This raises some queries on defining the norms of HRM. Storey (1995)’s hypothesis on the soft and hard models of human resource management (HRM) has received controversial debates from time to time to a very recent reaffirmation by Keenoy (1999) where he describes about the current state of HRM, is facing confusion and curious speculations. Severely subdivided and fragmented, the present day researchers are raising questions on the descriptive constructs and a valid acceptable proof on the future HRM (Beaumont, 1992; Boxall, 1996; Harley and Hardy, 2004). The paper makes an attempt to analytically investigate between the two schools of thought in HRM in the light of the debate between rhetoric and reality. The paradox will be analysed under the various factors of HRM, such as, Employer attitude, Value of the employee to the organization, Communications, Empowerment & Delegation, Pay, Performance Appraisals, Organizational Structure and Leadership Style in the scope of the paper. Finally, the way forward would be recommended in the best interest if the future of HRM as an ideal people-management tool. 1.1 Research Objective In the light of the above propositions, the paper wishes to analyze this paradox gap through following set objectives: 1. To find out the gap between the hyped rhetoric of a people-centred soft version of HRM and the hard form of people management. 2. In the light of this, to propose a recommendation to an alternate HRM to rule out the conceptual paradox. 2. Literature The norms and rules of HRM introduced the two traditional concepts of soft and hard models, simply referring to a loose and a tight form of articulation. Storey’s interpretation is traditionally derived from work of American HRM practices – a Harvard model for soft (Gill, 1999) and Michigan model for hard (Truss, 1999) versions, respectively. It is interesting to note that although the seeds of origin have merged from the American literature, the British context provide an exclusive debate. Going by the constructs, the benefits of human and resource lay emphasis on human relations, individual talents, and commitment to work-systems, external pressures, work-place relationships, efficient communication and a high-level of trust to flexibly adapt to the goals of a central management system (Storey, 2001). Soft HRM relates to a form of flexibility and adaptability in the management system. Hard HRM relates to a calculative, quantitative and business-strategic aspect of management (Storey, 2001; Legge, 1995b). The development-humanistic and utilitarian –instrumentalism are also referred to as Theory Y and Theory X in the literature of Human Resource Management. The difference between the two concepts of the soft model and hard model could be identified on the basis of four concepts, ambiguity, inconsistency, man’s moral nature, and the incompatibility of both the ideologies (Legge, 1995b; Truce, 1999). a) Employer attitude In the question of trust, the soft model suggests that individuals could be regarded worthy of trust and discretion. Attitude is all about what a person feels or thinks about a task. To gain a competitive edge, human assets are a source of how employees deliberate productivity, strength, adaptability, commitment and high quality. This is the source of competitive advantage and has a direct relationship with the organizational rhetoric (Argyris & Kaplan, 1994). Employee’s attitudes in relation to an organizational culture are critical to its success. This also helps in releasing tensions between top-down management and wage participatory approach to change. It is obvious that the employee’s behaviour resort to a soft version of HRM on the notion of their commitment to the organization. In the Theory Y, man’s exercise of self-control and direction is in the service of attaining the objectives of being committed to an organization (McGregor, 1960). Therefore, if an organization has to nurture more self-development and personal growth, it has to recognise the potential of human resources for integration demands and organizational success. This has a direct relationship with the soft version of HRM, as the notion of self-direction is central to the organizational objective. Noon’s concept of contradictory element of common man is influenced by physical, psychological and social laws create organizational reality, referring to the modern day version hard version of human resource management (Noon, 1992). b) Value of the employee to the organization The hard model of HRM assumes that if employees are allowed to work autonomously and gain control over their work and feel a sense of trust and discretionary power. An archetypal statement by the employers stating how the presence of a qualified and energetic staff has contributed to the success of the company and continued prosperity in the future (Francis and Keegan, 2006), by mentioning how much are the employees considered to be assets in the company and the success measures are meant to award the employers, matters in success. Close integration of human resources to business strategy, or considering them as costs leading to downsizing. When employees are considered as important factors in production process, they are managed as input in the production process, against the output of performance in the production process. Interestingly, performance-related pay or even an individual reward system has been found to undermine commitment of employees (Gill, 1999). Again, the fact that the employees work best if they are given a feeling to inculcate their full-fledged commitment to the organization, referring to the soft version or Theory Y approach of HRM. Commitment is bound to increase if the employees trained, developed and allowed more autonomy in decision-making and work-control. c) Communications Communication plays a key role in tackling problems related to change in an organization. To enhance commitment and more understanding, the role of communication could be interpreted on a rhetoric soft model concept, considering the extensive use of communication as a mechanism to increase commitment among employees (Legge, 1995a, 1995b). Additionally, group-based communication enables employees to be aware of the various activities happening in an organization through a variety of information channels. In fact, communication plays a key role in maximizing an employee’s commitment to an organization (Guest, 1990). Again, upward communication is less common than downward communication in an organization. d) Empowerment & Delegation The apparently soft perspectives of soft version of HRM could be directly ascribed to empowerment and self-involvement of an employee, in addition to communication and training, when analysed closely. These factors have a direct influence on the improvement of bottom-line performance of organizations. Empowerment is one such trait which is difficult to be idealized in private and proclaimed only in public. In a typically hierarchical structure, the rhetoric of empowerment could be aligned to hard versions of HRM, involving intensification in the work-flow process, autonomy of the employees in decision-making and the influence of the employees through a close surveillance (Blyton and Turnbull, 1994). Espousing empowerment through the soft version rhetoric theory is significant as it responsible for an increased management control and more sense of employability. It is an interesting observation that although training helps inculcate organizational betterment, individual development is not the explicit goal of an organization, questioning the humanistic stance of a soft-model. e) Pay The factor of employability and employee output, such as performance is measured in terms of economic exchange, such as pay and reward-related systems in an organization. All this comes within the purview of hard version of HRM, when this variable has a direct influence on payment for results or even performance. (Blyton and Turnbull, 1994). It has been empirically observed that a centralised paternalistic system of pay and reward emphasizes on performance management, devolution of responsibility at various managerial levels and a framework system of job design and grading, is a form of hard version of HRM (Gill, 1999). f) Performance Appraisals Employees become a factor in production through performance-related pay, based on individual performance, limited group-performance and organizational performance. Industry-competitive wages and hike in salaries are important considerations of business-strategic decisions of managing the headcount. This perspective is considered in the hard version of HRM, often considering employees as costs, stressing the need to increase the output or minimizing the costs through changing employment arrangements (Storey, 2001). The advantage of hard model is in its ultimate goal of securing a competitive advantage of the organization. Therefore, through a tight control on performance and its management, is mandatory for more control and tightness in administration. g) Organizational Structure The reality of an organization is hard version of HRM, stressing on the factors of quantitative, calculative and strategic components. Coming from the strategic control, the hard model reviews the effectiveness of human resource strategies, human resource functions and the pluralist needs of the employees. However, perspective of work-place structure and introduction of new technology in office, changes in the managerial and non-managerial aspects to improve productivity and efficiency fall under the purview of soft version of management (Gill, 1999). h) Leadership Style The paradigms of developmental humanism or soft version of HRM, emphasize on the importance of HR objectives and business policies to on fair treatment of employees, who are held as assets and a source of competitive advantage through their commitment and efficiency. This is a proactive measure, generating leadership, participation and sincere motivation to organizational goals (Legge, 1995a, 1995b) 3. Summary/Conclusion and Recommendations A through content analysis of each of the dimensions of HR analysis reveals that the divide of rhetoric and reality could further analysed to understand the basics of soft and hard version of HRM. 1. While the soft version takes into consideration the direct references of values and practices to encourage employees to be dealt as assets and source of competitive advantage. Through their involvement, participation and a proper communication channel, employees are motivated to contribute to the success of the company. Further, capacity building through Training and Development helps meet the needs of the individuals and the organization. Actions relating to such direct references of soft version of HRM, essentially view the employee as a human value. 2. In the purview of hard version of HRM, a closer integration of human resources with strategic tactics is necessary to avoid considering employees more as costs and include them in the productive process. 3. In the benefit of organizational management, HR systems and organizations need to be congruent to each other. This is achievable through a formal objective, strategic vision and HR management for critical task management. This calculative, business-oriented and managerial approach is strictly economic. The strategic HR practices and policies deliberate a rational approach to achieve organizational success. However, they do not consider the social objectives of performing business operations. 4. The ideal admixture of a synergistic best-practices model would be a blend of unique external and internal factors of an organization, their strategy, organizational culture, and structure which play a vital role in determining the HR practices to improve in a way that HRM operates. 5. Finally, it is difficult to define clearly the tenets of soft version on the basis of any empirical data or even underline the principles of bottom-line performance within an organization that is holding employees are human assets for performance enhancement of stressing on individualistic performance appraisal. However, not many policies and practices are consistently espousing those propositions. Most of the soft version factors are simultaneous with business-strategies, generating a holistic conclusion. It is also hard to say that the moral nature of soft human version is a total misfit within the premise of HRM. Further research is necessary to segregate the strategically important but ethical elements in a firm’s business from the non- strategic, but equally important ones. Reference List Argyris, C. and Kaplan, R., 1994. Implementing new knowledge: the case of activity based costing. Accounting Horizons, 8(3), pp.83-105. Beaumont, P. B., 1992. The US human resource management literature: a review. In Salaman, G., Human Resource Strategies, London: Sage. Boxall, P., 1996. The strategic HRM debate and the resource-based view of the firm. Human resource management Journal, 6(3), pp.59-75. Blyton P. and Turnbull, P., 1994. Reassessing Human Resource Management, London: Sage Francis, H. and Keegan, A., 2006. The changing face of HR: in search of balance. Human Resource Management Journal, 16(3), pp.231–49. Gill, C., 1999. Use of Hard and Soft Models of HRM to illustrate the gap between Rhetoric and Reality in Workforce Management. Working Paper Series No WP 99/13. Australia:RMIT School of Business. Guest, D. E., 1990. Human resource management and the American dream. Journal of Management Studies, 27(4), pp.377-97. Harley, B. and Hardy, C., 2004. Firing Blanks? An Analysis of Discursive Struggle in HRM. Journal of Management Studies, 41(3), pp.377-400. Keenoy, T., 1999. HRM as hologram: A polemic. The Journal of Management Studies, 36(1), pp. 1 - 23. Legge, K., 1995a. Rhetoric, reality and hidden agendas. In J. Storey , Human Resource Management: A Critical Text. London: Routledge, pp.33-59. Legge, K., 1995b. Human Resource Management: Rhetorics and Realities. Basingstoke: Macmillan. Noon, M., 1992. Human Resource Management: a map, model or theory? In Blyton, P. and Turnbull, P., (eds), Reassessing Human Resource Management. 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